Summary of this article
Overseas education involves significant opportunity costs.
Higher foreign salaries may not mean higher savings.
Course and career outcomes determine financial value.
For several Indian families, sending a child abroad for higher education is seen as an investment for a better future. However, a recent social media post has sparked debate over whether an overseas degree always justifies the cost. A post shared by a financial creator described a family that liquidated 15 years of fixed deposits (FDs) to fund their son’s master’s degree in Canada. The family has also reportedly spent nearly Rs 50 lakh on his education.
The son now works in Toronto and earns about CA$55,000 (Canadian dollar) a year. However, according to the post, after accounting for rent, taxes and other living expenses, his savings are lower than what he might have been able to accumulate while working in a mid-sized Indian city. This post has now raised a bigger question: whether studying abroad is necessarily a path to financial freedom or whether the cost of pursuing that dream outweighs the financial benefits
The Rs 50 Lakh Question
The financial consideration here is not simply the amount that is spent on tuition and living costs abroad. It is also about getting an opportunity that is worth the money spent. If a family liquidates FDs worth Rs 50 lakh, it gives up the interest and potential compounding that the money could have generated over the years. Therefore, families need to compare the education costs and lost investment returns as well as the overseas living expenses against the expected income of the students.
Higher Salary Does Not Mean Higher Savings
Another important differentiation is between the salary and the disposable income. Any overseas job may offer a higher salary when it is converted into rupees. However, that figure does not tell the entire story. Be it housing, healthcare, taxes, transportation, food, or other living, costs can consume a considerable portion of their income. In the example highlighted in the post, the son’s CA$55,000 annual salary needs to be viewed in the context of Toronto’s living costs. Comparing the Canadian salary directly with an Indian salary is misleading and can give misleading financial outcomes.
Says Abhishek Kumar, a Securities and Exchange Board of India-registered investment advisor (Sebi RIA) and founder at SahajMoney: “Funding a postgraduate degree should not be viewed solely through the lens of opportunity cost, as upskilling does come at a price and more often than not it may not lead to immediate financial gains. But that is the wrong yardstick because if it is essential for honing one’s skills and staying relevant in a rapidly changing job market, then it deserves to be treated as a long-term investment rather than a short-term expense.”
“The true value of such an investment lies not in an immediate jump in income, but in the durability of one’s career and in their ability to adapt and stay relevant through shifts in technology and industry demand. If it’s judged only by the salary bump in the initial years, then a postgraduate degree may look expensive, but when judged by the payout over a lifetime, it often proves to be one of the wisest decisions a professional can make,” he adds.
Education Is More Than an ROI Calculation
One should also be open-minded to these factors, as job markets get more complex and saturated. Judging an overseas education purely through immediate financial returns may be too narrow. International education provides a boost in one’s professional life; it can provide easy access to specialised courses, international work experience, professional networks, and long-term career opportunities.
Says Prashant A. Bhonsle, founder and CEO, Kuhoo Finance: “It is becoming increasingly common for families to realise that the actual financial outcome of studying abroad may be very different from what they had imagined. A foreign salary can look very attractive when converted into rupees. But the student is also paying foreign rent, taxes, food, transport, insurance and other living expenses. So the more important question is not, “What salary is my child earning?” but “After all expenses, how much is my child actually saving?” Many families still start with the assumption that a foreign degree will automatically lead to a better job, higher income, and a better life. That may happen, especially from a good university and the right course, but today it cannot be taken for granted. Every student’s case is different. But the larger point behind the post is certainly worth thinking about.”
The financial outcome can change considerably depending on the course, university, country, education loan burden, and employment. An overseas degree can be a valuable investment, but like any other investment, the cost, expected returns, risks and alternatives must be evaluated before committing the money.
